FDIC Law, Regulations, Related Acts

6500 - Consumer Financial Protection Bureau

Appendix C to Part 1002Sample Notification Forms

1. This Appendix contains ten sample notification forms. Forms C--1
through C--4 are intended for use in notifying an applicant that
adverse action has been taken on an application or account under
§§ 1002.9(a)(1) and (2)(i) of this part. Form C--5 is a notice of
disclosure of the right to request specific reasons for adverse action
under §§ 1002.9(a)(1) and (2)(ii). Form C--6 is designed for use in
notifying an applicant, under § 1002.9(c)(2), that an application is
incomplete. Forms C--7 and C--8 are intended for use in connection with
applications for business credit under § 1002.9(a)(3). Form C--9 is
designed for use in notifying an applicant of the right to receive a
copy of appraisals under § 1002.14. Form C--10 is designed for use in
notifying an applicant for nonmortgage credit that the creditor is
requesting applicant characteristic information.

2. Form C--1 contains the Fair Credit Reporting Act disclosure as
required by sections 615(a) and (b) of that act. Forms C--2 through
C--5 contain only the section 615(a) disclosure (that a creditor
obtained information from a consumer reporting agency that was
considered in the credit decision). A creditor must provide the section
615(a) disclosure when adverse action is taken against a consumer based
on information from a consumer reporting agency. A creditor must
provide the section 615(b) disclosure when adverse action is taken
based on information from an outside source other than a consumer
reporting agency. In addition, a creditor must provide the section
615(b) disclosure if the creditor obtained information from an
affiliate other than information in a consumer report or other than
information concerning the affiliate's own transactions or experiences
with the consumer. Creditors may comply with the disclosure
requirements for adverse action based on information in a consumer
report obtained from an affiliate by providing either the section
615(a) or section 615(b) disclosure. Optional language in Forms C--1
through C--5 may be used to direct the consumer to the entity that
provided the credit score for any questions about the credit score,
along with the entity's contact information. Creditors may use or not
use this additional language without losing the safe harbor, since the
language is optional.

3. The sample forms are illustrative and may not be appropriate for
all creditors. They were designed to include some of the factors that
creditors most commonly consider. If a creditor chooses to use the
checklist of reasons provided in one of the sample forms in this
Appendix and if reasons commonly used by the creditor are not provided
on the form, the creditor should modify the checklist by substituting
or adding other reasons. For example, if "inadequate down
payment" or "no deposit relationship with us" are common
reasons for taking adverse action on an application, the creditor ought
to add or substitute such reasons for those presently contained on the
sample forms.

4. If the reasons listed on the forms are not the factors actually
used, a creditor will not satisfy the notice requirement by simply
checking the closest identifiable factor listed. For example, some
creditors consider only references from banks or other depository
institutions and disregard finance company references altogether; their
statement of reasons should disclose "insufficient bank
references," not "insufficient credit references." Similarly,
a creditor that considers bank references and other credit references
as distinct factors should treat the two factors separately and
disclose them as appropriate. The creditor should either add such other
factors to the form or check "other" and include the appropriate
explanation. The creditor need not, however, describe how or why a
factor adversely affected the application. For example, the notice may
say "length of residence" rather than "too short a period of
residence."

5. A creditor may design its own notification forms or use all or a
portion of the forms contained in this Appendix. Proper use of Forms
C--1 through C--4 will satisfy the requirement of § 1002.9(a)(2)(i).
Proper use of Forms C--5 and C--6 constitutes full compliance with
§§ 1002.9(a)(2)(ii) and 1002.9(c)(2), respectively. Proper use of
Forms C--7 and C--8 will satisfy the requirements of
§§ 1002.9(a)(2)(i) and (ii), respectively, for applications for
business credit. Proper use of Form C--9 will satisfy the requirements
of § 1002.14 of this part. Proper use of Form C--10 will satisfy the
requirements of § 1002.5(b)(1).

Form C1Sample Notice of Action Taken and Statement of Reasons

Statement of Credit Denial, Termination or Change

Date: _______

Applicant's Name:

_______

Applicant's Address:

Description of Account, Transaction, or Requested Credit:

_______

_______

Description of Action Taken:

_______

_______

_______

_______

Part I--Principal Reason(s) for Credit Denial,
Termination, or Other Action Taken Concerning Credit This section
must be completed in all instances.

_______Credit application incomplete

_______Insufficient number of credit references provided

_______Unacceptable type of credit references provided

_______Unable to verify credit references

_______Temporary or irregular employment

_______Unable to verify employment

_______Length of employment

_______Income insufficient for amount of credit requested

_______Excessive obligations in relation to income

_______Unable to verify income

_______Length of residence

_______Temporary residence

_______Unable to verify residence

_______No credit file

_______Limited credit experience

_______Poor credit performance with us

_______Delinquent past or present credit obligations with
others

_______Collection action or judgment

_______Garnishment or attachment

_______Foreclosure or repossession

_______Bankruptcy

_______Number of recent inquiries on credit bureau report

_______Value or type of collateral not sufficient

_______Other, specify: _______

Part II--Disclosure of Use of Information Obtained From an
Outside Source

This section should be completed if the credit decision was based in
whole or in part on information that has been obtained from an outside
source.

_______ Our credit decision was based in whole or in
part on information obtained in a report from the consumer reporting
agency listed below. You have a right under the Fair Credit Reporting
Act to know the information contained in your credit file at the
consumer reporting agency. The reporting agency played no part in our
decision and is unable to supply specific reasons why we have denied
credit to you. You also have a right to a free copy of your report from
the reporting agency, if you request it no later than 60 days after you
receive this notice. In addition, if you find that any information
contained in the report you receive is inaccurate or incomplete, you
have the right to dispute the matter with the reporting agency.

Name: _______

Address: _______

[Toll-free] Telephone number:

_______

[We also obtained your credit score from the consumer
reporting agency and used it in making our credit decision. Your credit
score is a number that reflects the information in your consumer
report. Your credit score can change, depending on how the information
in your consumer report changes.

Your credit score: ___________

Date: ___________

Scores range from a low of ____ to a high of ____.

Key factors that adversely affected your credit score:

_______

_______

_______

_______

[Number of recent inquiries on consumer report, as a key
factor]

[If you have any questions regarding your credit score, you
should contact [entity that provided the credit score] at:

_______

_______

Address:

_______

_______

[[Toll-free] Telephone number: _______]

_______ Our credit decision was based in whole or in
part on information obtained from an affiliate or from an outside
source other than a consumer reporting agency. Under the Fair Credit
Reporting Act, you have the right to make a written request, no later
than 60 days after you receive this notice, for disclosure of the
nature of this information.

If you have any questions regarding this notice, you should
contact:

Creditor's name: _______

Creditor's address: _______

Creditor's telephone number: _______

Notice: The Federal Equal Credit Opportunity Act prohibits
creditors from discriminating against credit applicants on the basis of
race, color, religion, national origin, sex, marital status, age
(provided the applicant has the capacity to enter into a binding
contract); because all or part of the applicant's income derives from
any public assistance program; or because the applicant has in good
faith exercised any right under the Consumer Credit Protection Act. The
Federal agency that administers compliance with this law
concerning
this creditor is (name and
address as specified by the appropriate agency listed in Appendix
A).

Form C2Sample Notice of Action Taken and Statement of Reasons

Date: _______

Dear Applicant: Thank you for your recent application. Your
request for [a loan/a credit card/an increase in your credit limit]
was carefully considered, and we regret that we are unable to approve
your application at this time, for the following reason(s):

Your Income:

_______ is below our minimum requirement.

_______ is insufficient to sustain payments on the
amount of credit requested.

_______ could not be verified.

Your Employment:

_______ is not of sufficient length to qualify.

_______ could not be verified.

Your Credit History:

_______ of making payments on time was not satisfactory.

_______ could not be verified.

Your Application:

_______ lacks a sufficient number of credit references.

_______ lacks acceptable types of credit references.

_______ reveals that current obligations are excessive
in relation to income.

Other:

_______

The consumer reporting agency contacted that provided
information that influenced our decision in whole or in part was
[name, address and [toll-free] telephone number of the reporting
agency]. The reporting agency played no part in our decision and is
unable to supply specific reasons why we have denied credit to you. You
have a right under the Fair Credit Reporting Act to know the
information contained in your credit file at the consumer reporting
agency. You also have a right to a free copy of your report from the
reporting agency, if you request it no later than 60 days after you
receive this notice. In addition, if you find that any information
contained in the report you receive is inaccurate or incomplete, you
have the right to dispute the matter with the reporting agency. Any
questions regarding such information should be directed to [consumer
reporting agency]. If you have any questions regarding this letter,
you should contact us at [creditor's name, address and telephone
number].

[We also obtained your credit score from the consumer
reporting agency and used it in making our credit decision. Your credit
score is a number that reflects the information in your consumer
report. Your credit score can change, depending on how the information
in your consumer report changes.

Your credit score: ________

Date: _______________

Scores range from a low of ____ to a high of ____.

Key factors that adversely affected your credit score:

_______

_______

_______

_______

_______ [Number of recent inquiries on consumer report,
as a key factor]

[If you have any questions regarding your credit score, you
should contact [entity that provided the credit score] at:

Address:

_______

_______

[[Toll-free] Telephone number: _______ ]

Notice: The Federal Equal Credit Opportunity Act prohibits
creditors from discriminating against credit applicants on the basis of
race, color, religion, national origin, sex, marital status, age
(provided the applicant has the capacity to enter into a binding
contract); because all or part of the applicant's income derives from
any public assistance program; or because the applicant has in good
faith exercised any right under the Consumer Credit Protection Act. The
Federal agency that administers compliance with this law concerning
this creditor is (name and address as specified by the appropriate
agency listed in Appendix A).

Form C3Sample Notice of Action Taken and Statement of
Reasons(Credit Scoring)

Date

Dear Applicant:

Thank you for your recent application for _______ . We
regret that we are unable to approve your request.

[Reasons for Denial of Credit]

Your application was processed by a [credit scoring] system
that assigns a numerical value to the various items of information we
consider in evaluating an application. These numerical values are based
upon the results of analyses of repayment histories of large numbers of
customers.

The information you provided in your application did not
score a sufficient number of points for approval of the application.
The reasons you did not score well compared with other applicants were:

 Insufficient bank references

 Type of occupation

 Insufficient credit experience

 Number of recent inquiries on credit bureau report

[Your Right to Get Your Consumer Report]

In evaluating your application the consumer reporting agency listed
below provided us with information that in whole or in part influenced
our decision. The consumer reporting agency played no part in our
decision and is unable to supply specific reasons why we have denied
credit to you. You have a right under the Fair Credit Reporting Act to
know the information contained in your credit file at the consumer
reporting agency. It can be obtained by contacting: [Name, address,
and [toll-free] telephone number of the consumer reporting agency].
You also have a right to a free copy of your report from the reporting
agency, if you request it no later than 60 days after you receive this
notice. In addition, if you find that any information contained in the
report you receive is inaccurate or incomplete, you have the right to
dispute the matter with the reporting agency.

We also obtained your credit score from the consumer
reporting agency and used it in making our credit decision. Your credit
score is a number that reflects the information in your consumer
report. Your credit score can change, depending on how the information
in your consumer report changes.

Your credit score: _______

Date: _______

Scores range from a low of _______ to a high
of _______ .

Key factors that adversely affected your credit score:

_______

_______

_______

_______

[Number of recent inquiries on consumer report, as a key
factor]

[If you have any questions regarding your credit score, you
should contact [entity that provided the credit score] at:

Address: _______

[Toll-free] Telephone number: _______]

If you have any questions regarding this letter, you should
contact us at

Creditor's Name: _______

Address: _____________________

Telephone: _______

Sincerely,

Notice: The Federal Equal Credit Opportunity Act
prohibits creditors from discriminating against credit applicants on
the basis of race, color, religion, national origin, sex, marital
status, age (with certain limited exceptions); because all or part of
the applicant's income derives from any public assistance program; or
because the applicant has in good faith exercised any right under the
Consumer Credit Protection Act. The Federal agency that administers
compliance with this law concerning this creditor is (name and address
as specified by the appropriate agency listed in Appendix A).

Form C4Sample Notice of Action Taken, Statement of Reasons and
Counteroffer

Date

Dear Applicant:

Thank you for your application for _______ . We are
unable to offer you credit on the terms that you requested for the
following reason(s):

_______

_______

We can, however, offer you credit on the following terms:

_______

If this offer is acceptable to you, please notify us within
[amount of time] at the following address:

_______

_______ .

Our credit decision on your application was based in whole or
in part on information obtained in a report from [name, address and
[toll-free] telephone number of the consumer reporting agency]. You
have a right under the Fair Credit Reporting Act to know the
information contained in your credit file at the consumer reporting
agency. The reporting agency played no part in our decision and is
unable to supply specific reasons why we have denied credit to you. You
also have a right to a free copy of your report from the reporting
agency, if you request it no later than 60 days after you receive this
notice. In addition, if you find that any information contained in the
report you receive is inaccurate or incomplete, you have the right to
dispute the matter with the reporting agency.

[We also obtained your credit score from the consumer
reporting agency and used it in making our credit decision. Your credit
score is a number that reflects the information in your consumer
report. Your credit score can change, depending on how the information
in your consumer report changes.

Your credit score: _______

Date: _______

Scores range from a low of ____ to a high of ____.

Key factors that adversely affected your credit score:

_______

_______

_______

_______

[Number of recent inquiries on consumer report, as a key
factor]

[If you have any questions regarding your credit score, you
should contact [entity that provided the credit score] at:

Address: _______

[Toll-free] Telephone number: _______]

You should know that the Federal Equal Credit Opportunity
Act prohibits creditors, such as ourselves, from discriminating against
credit applicants on the basis of their race, color, religion, national
origin, sex, marital status, age (provided the applicant has the
capacity to enter into a binding contract), because they receive income
from a public assistance program, or because they may have exercised
their rights under the Consumer Credit Protection Act. If you believe
there has been discrimination in handling your application you should
contact the [name and address of the appropriate Federal enforcement
agency listed in Appendix A].

Sincerely,

Form C5Sample Disclosure of Right To Request Specific Reasons
for Credit Denial

Date

Dear Applicant:

Thank you for applying to us for _______.

After carefully reviewing your application, we are sorry to
advise you that we cannot [open an account for you/grant a loan to
you/increase your credit limit] at this time. If you would like a
statement of specific reasons why your application was denied, please
contact [our credit service manager] shown below within 60 days of
the date of this letter. We will provide you with the statement of
reasons within 30 days after receiving your request.

Creditor's name Address Telephone
number

If we obtained information from a consumer reporting agency
as part of our consideration of your application, its name, address,
and [toll-free] telephone number is shown below. The reporting agency
played no part in our decision and is unable to supply specific reasons
why we have denied credit to you. [You have a right under the Fair
Credit Reporting Act to know the information contained in your credit
file at the consumer reporting agency.] You have a right to a free
copy of your report from the reporting agency, if you request it no
later than 60 days after you receive this notice. In addition, if you
find that any information contained in the report you received is
inaccurate or incomplete, you have the right to dispute the matter with
the reporting agency. You can find out about the information contained
in your file (if one was used) by contacting:

Consumer reporting agency's name Address
[Toll-free] Telephone number

[We also obtained your credit score from the consumer
reporting agency and used it in making our credit decision. Your credit
score is a number that reflects the information in your consumer
report. Your credit score can change, depending on how the information
in your consumer report changes.

Your credit score: _______

Date: _______

Scores range from a low of _______ to a high
of _______ .

Key factors that adversely affected your credit score:

_______

_______

_______

_______

[Number of recent inquiries on consumer report, as a key
factor]

[If you have any questions regarding your credit score, you
should contact [entity that provided the credit score] at:

Address: _______

[Toll-free] Telephone number: _______]

Sincerely,

Notice:The Federal Equal Credit Opportunity Act
prohibits creditors from discriminating against credit applicants on
the basis of race, color, religion, national origin, sex, marital
status, age (provided the applicant has the capacity to enter into a
binding contract); because all or part of the applicant's income
derives from any public assistance program; or because the applicant
has in good faith exercised any right under the Consumer Credit
Protection Act. The Federal agency that administers compliance with
this law concerning this creditor is (name and address as specified by
the appropriate agency listed in Appendix A).

Form C6Sample Notice of Incomplete Application and Request for
Additional Information

Creditor's name Address Telephone
number

Date

Dear Applicant:

Thank you for your application for credit. The following
information is needed to make a decision on your application:

_______

We need to receive this information by _______ (date).
If we do not receive it by that date, we will regrettably be unable to
give further consideration to your credit request.

Sincerely,

Form C7Sample Notice of Action Taken and Statement of
Reasons(Business Credit)

Creditor's name

Creditor's address

Date

Dear Applicant:

Thank you for applying to us for credit. We have given your
request careful consideration, and regret that we are unable to extend
credit to you at this time for the following reasons:

(Insert appropriate reason, such as: Value or type of
collateral not sufficient; Lack of established earnings record; Slow or
past due in trade or loan payments)

Sincerely,

Notice:The Federal Equal Credit Opportunity Act
prohibits creditors from discriminating against credit applicants on
the basis of race, color, religion, national origin, sex, marital
status, age (provided the applicant has the capacity to enter into a
binding contract); because all or part of the applicant's income
derives from any public assistance program; or because the applicant
has in good faith exercised any right under the Consumer Credit
Protection Act. The Federal agency that administers compliance with
this law concerning this creditor is [name and address as specified by
the appropriate agency listed in Appendix A].

Form C8Sample Disclosure of Right To Request Specific Reasons
for Credit Denial Given at Time of Application (Business Credit)

Creditor's name

Creditor's address

If your application for business credit is denied, you have the right
to a written statement of the specific reasons for the denial. To
obtain the statement, please contact [name, address and telephone
number of the person or office from which the statement of reasons can
be obtained] within 60 days from the date you are notified of our
decision. We will send you a written statement of reasons for the
denial within 30 days of receiving your request for the statement.

Notice:The Federal Equal Credit Opportunity Act
prohibits creditors from discriminating against credit applicants on
the basis of race, color, religion, national origin, sex, marital
status, age (provided the applicant has the capacity to enter into a
binding contract); because all or part of the applicant's income
derives from any public assistance program; or because the applicant
has in good faith exercised any right under the Consumer Credit
Protection Act. The Federal agency that administers compliance with
this law concerning this creditor is [name and address as specified by
the appropriate agency listed in Appendix A].

Form C9Sample Disclosure of Right To Receive a Copy of an
Appraisal

You have the right to a copy of the appraisal report used in
connection with your application for credit. If you wish a copy, please
write to us at the mailing address we have provided. We must hear from
you no later than 90 days after we notify you about the action taken on
your credit application or you withdraw your application.

[In your letter, give us the following information:]

Form C10Sample Disclosure About Voluntary Data Notation

We are requesting the following information to monitor our compliance
with the Federal Equal Credit Opportunity Act, which prohibits unlawful
discrimination. You are not required to provide this information. We
will not take this information (or your decision not to provide this
information) into account in connection with your application or credit
transaction. The law provides that a creditor may not discriminate
based on this information, or based on whether or not you choose to
provide it. [If you choose not to provide the information, we will
note it by visual observation or surname].